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Outflows Continue, Despite a $74B Passive Flows Reversal
Despite a $73.567-billion reversal in passive fund flows, industry outflows continued last month thanks to rising active outflows.
This article draws from Morningstar Direct data for May 2022 mutual fund and ETF flows, excluding money-market funds and funds of funds. (Other asset management products, like collective trusts and SMAs, are also not included.***) More specifically, this article focuses on the eight firms with more than $500 billion each in long-term fund and ETF AUM.
Jumbo fund firms had $16.414 trillion in long-term fund AUM as of May 31, 2022, and they accounted for 66.91 percent of overall industry long-term AUM. That compares with $16.346 trillion and 66.49 percent on April 30, 2022.
Three of those jumbo firms brought in net inflows in May 2022, up from none in April.
BlackRock took the jumbo fund firm lead last month, thanks to an estimated $29.237 billion in net May 2022 inflows, up month-over-month from $12.123 billion in April 2022 outflows and up year-over-year from $15.17 billion in May 2021. The other two May 2022 inflows winners were: SSGA, $7.298 billion (up M/M from $11.151 billion in net outflows, up Y/Y from $469 million); and Vanguard, $4.211 billion (up M/M from $7.582 billion in net outflows, down Y/Y from $33.175 billion).
BlackRock also took the 2022 lead after the first five months of 2022, thanks to an estimated $51.104 billion in net inflows year-to-date. Other big YTD inflows winners inflows: Vanguard, $48.187 billion; and Fidelity, $19.265 billion.
On the flip side, Capital Group's American Funds took the outflows lead last month, thanks to an estimated $7.158 billion in net May 2022 outflows, up M/M from $3.572 billion in April 2022 but down Y/Y from $2.128 billion in May 2021 inflows. Other big May 2022 outflows sufferers included: T. Rowe Price, $5.656 billion (up M/M from $4.44 billion, up Y/Y from $2.454 billion); and Invesco, $1.582 billion (down M/M from $3.637 billion, down Y/Y from $6.563 billion in net inflows).
T. Rowe also led the jumbo fund firm outflows pack after the first five months of 2022, thanks to an estimated $20.61 billion in net YTD outflows. The other other jumbo outflows sufferer YTD was Cap Group, with $8.532 billion.
As a group, the eight largest fund firms brought in an estimated $24.247 billion in net May 2022 inflows, equivalent to 0.15 percent of their combined AUM. That's up M/M from $44.067 billion in net outflows in April 2022, equivalent to 0.27 percent of their AUM.
After the first five months of 2022, jumbo fund firms had brought in $100.79 billion in net YTD inflows. That's equivalent to 0.61 percent of their combined AUM.
Across the entire industry, the 787 firms tracked by the M* team (down M/M from 796 but up Y/Y from 760) suffered an estimated $39.103 billion in net May 2022 outflows, equivalent to 0.16 percent of the industry's $24.532 trillion in long-term fund AUM. (298 firms brought in net May inflows, down from 320 in April.) That's down M/M from $89.224 billion and 0.36 percent of $24.585 trillion of AUM in April 2022 and down Y/Y from $82.763 billion in net inflows and 0.32 percent of $26.156 trillion of AUM in May 2021.
Active funds suffered an estimated $109.837 billion in net May 2022 outflows, up M/M from $86.386 billion and down Y/Y from $11.451 billion in net inflows. Yet passive funds brought in an estimated $70.729 billion in net May 2022 inflows, up M/M from $2.838 billion in net outflows and down Y/Y from $71.312 billion.
After the first five months of 2022, the industry had suffered $46.598 billion in net YTD outflows, equivalent to about 0.19 percent of industry long-term AUM. 390 firms have brought in net inflows YTD.
***This caveat is particularly important for jumbo fund firms, many of which are big players in the 401(k) business, where collective investment trusts (CITs) are a commonly used alternative to traditional mutuals. For example, as the T. Rowe team revealed last week, in the first five months of 2022 their clients transferred about $5.8 billion out of T. Rowe mutual funds and into other T. Rowe products like CITs and SMAs. And T. Rowe is a big retirement plan provider and DC I-O asset manager, especially in the target-date fund (TDF) space.
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